Elsevier

Journal of Engineering and Technology Management

Volume 54, October–December 2019, Pages 12-27
Journal of Engineering and Technology Management

Digitalizing the maritime industry: A case study of technology acquisition and enabling advanced manufacturing technology

https://doi.org/10.1016/j.jengtecman.2019.06.001Get rights and content

Abstract

The need to reduce time-to-market and reduce cost-of-non-quality drives organizations operating within the advanced manufacturing industry to explore, and source technology externally. This paper reports on a case study of enabling technology and strategies for technology acquisition. The data is collected through in-depth structured interviews with five global technology experts. The interview guide is developed based on data collected in the Norwegian maritime industry, which deliver vessels to global markets and a high-level adopter of advanced manufacturing technology. The analyzis was done in Nvivo. Results relates to three modes of technology acquisition, namely alliances & licensing, monitor, acquire&merger, and coopetition.

Introduction

Today in the private and public sector there is a lot of discussion regarding the digitalization of products, processes and services. Digitalization of traditional sectors, such as manufacturing, places challenging requirements on organizations to change and adapt accordingly. Germany Trade & Invest has labelled this ‘the fourth industrial revolution’ and introduced it with the terminology Industrie 4.0, where the first revolution was the introduction of mechanical production facilities with the help of water and steam power. The second revolution was the introduction of division of labor and mass production with the help of electrical energy, and the third revolution was the use of electronic and IT systems that further automated production. The fourth industrial revolution, which is currently taking place, involves the utilization of cyber-physical systems at its core (Kagermann et al., 2013) illustrated in (Fig. 1).

In England, the government has also initiated a program to direct the attention towards digitalization, namely the Catapult Programme (https://catapult.org.uk/). The underlying motivation for such initiatives posits that there has been an underinvestment in infrastructure for test and validation of these new digital technologies. The aim is to re-industrialize national manufacturing capabilities. This argument is not new as Naik and Chakravarty in 1992, conclude that the US manufacturing industry had lost reputation due to short-term financial orientation resulting in underinvestment in new equipment, technology, and research and development (R&D). In the US today you find strategic initiatives with similar reasoning, one such example is the Digital and Manufacturing Design Innovation Institute (DMDII) (http://dmdii.uilabs.org/). More and more countries such as Norway (Siva, 2015) follow this trend, elucidating its importance.

High initial capital expenditures are denoted as moderators and hurdles for why traditional manufacturing industries are conservative in adopting the new technologies and systems (Koren and Shpitalni, 2010; Wang et al., 2015). Therefore, achieving short time-to-market and time-to-value (reduction of cost of non-quality) have become crucial for organizations in a time when the velocity of developments in new technologies and systems, and environmental dynamism is higher than previously seen; like the case of Moore’s law. One constraint for exploring more flexibility and responsiveness in manufacturing technologies is the asymmetry in resource allocation to early design phases of the manufacturing process. Youssef et al. (1998) underpin that the most commonly used advanced manufacturing technologies are used in design and planning phase, hence it appears to be an untapped potential in exploring advanced manufacturing technologies that reallocate resources to later stages in the process shown in Fig. 2, or to source new strategies for reducing the high initial capital expenditures.

Therefore, the motivation of this study is to better understand the developments represented by enabling technologies for advanced manufacturing within the maritime industry. Further, identify strategies for how organizations can acquire the capabilities and technologies needed to successfully transition into a digitalized manufacturing environment. By understanding this, organizations may more effectively utilize their resourced, providing slack resources or higher rates of financial return.

Section snippets

Advanced manufacturing technology

Advanced manufacturing is not a new term for either practitioners or scholars, and has been given extensive attention due to its role in providing competitive advantage (Sambasivarao and Deshmukh, 1995; Pagell et al., 2000; Karsak and Tolga, 2001). However, the definition and a clear taxonomy has proven to be difficult to agree upon, and given its complexity, diverse and fast developing nature – that may not be such an issue. Noteworthy, this study do not intend to extend these attempts. Thus,

Research design

The nature of digitalization and technology acquisition is contemporary, social, and ongoing and therefor performing case study and collecting data through interviews holds a good fit in regards to research design (Yin, 2013). Yin (2013) also call for case study design when the aim is to contribute to theory in fields of inquiry where there exists less defined frameworks and lack of coherent theory and definitions, asking how and why questions – seeking several answers. In addition to Yin (2013)

Results and findings from the analysis

The statements presented in this section is based on the analysis and agglomeration of the informant’s statements – and not the authors.

Digitalization of traditional industry and sectors, such as manufacturing, and in society in general is not a new phenomenon and the terminology is myriad. The informants emphasize that digitalization has been an incremental and continuous development from back in late 1950-60 s when the transition from the mechanical analogue to digital began. An example given

Discussion and implications

This study explores enabling technologies and strategy choice related to required investments, and technology acquisition – within the context of the advanced manufacturing industry, part of the maritime industry. An important implication of digitalization of the industry, addressed by the informants, is the fact that outsourcing production to far-off sites do not serve as a long-term strategy. The foundation of this argument is that the operator cost is no longer of interest due to the degree

Conclusion

This articles case study contribute to the literature on advanced manufacturing by exploring different acquisition scenarios for enabling technology. Further, it contributes to the research domain of technology acquisition by exploring different strategic choice and implications for business models. By exploring strategic choice and introducing coopetition to the discussion within advanced manufacturing, this study expands the portfolio of strategies.

New business models change the way

Acknowledgement

We would like to express our gratitude and thank all the informants for this study for valuable and inspiring insights and motivating conversations. This work is supported by Rolls-Royce Marine innovation initiatives, and has been financed by Rolls-Royce Marine and the Research Counsil of Norway (Norsk Forskningsråd) with given project ID. 241587, who are both gratefully acknowledged. The SCANCOR community at Stanford University is also gratefully acknowledged for their contribution in

Oda Ellingsen – holds a certificate as a skilled CNC-operator from Rolls-Royce Marine, has a B.Sc. within mechanical engineering, a M.Sc. within business development and entrepreneurship, and is currently pursuing a PhD as an Industrial Candidate sponsored by Rolls-Royce Marine and the Reseearch Council of Norway at the Norwegian University of Science and Technology. She has also held a position as a Design Engineer for Rolls-Royce Marine.

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  • Cited by (0)

    Oda Ellingsen – holds a certificate as a skilled CNC-operator from Rolls-Royce Marine, has a B.Sc. within mechanical engineering, a M.Sc. within business development and entrepreneurship, and is currently pursuing a PhD as an Industrial Candidate sponsored by Rolls-Royce Marine and the Reseearch Council of Norway at the Norwegian University of Science and Technology. She has also held a position as a Design Engineer for Rolls-Royce Marine.

    Knut Einar Aasland – is a professor of engineering design at the Norwegian University of Science and Technology, NTNU. He has a M.Sc. in mechanical engineering and a PhD in engineering design. His research has focused on design methodology, efficient design methods for smaller companies, mechatronics and health applications of product design.

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